Taiwan’s actively managed exchange-traded funds (ETFs) have become an investment frenzy, with several offerings more than doubling in value within a year as strong market gains and notable returns draw a surge of investor money into the fast-growing area.
The rapid ascent of active ETFs is the newest phase in Taiwan’s retail investing cycle, following earlier waves of enthusiasm for high-dividend strategies and market-cap weighted index funds.
Fund managers say the shift has become so pervasive that many retail investors are increasingly embracing “saving through ETFs” as a long-term strategy, rather than relying on traditional stock picking.
Photo: CNA
According to data from the Securities Investment Trust and Consulting Association (SITCA, 投信投顧公會), the number of investors holding Taiwan-listed active ETFs has climbed above 1.04 million, setting a record high for 23 consecutive weeks as new products continue to enter the market.
Asset managers say fundraising momentum has far exceeded expectations. Whereas new mutual funds typically raised between NT$1 billion (US$31.7 million) and NT$4 billion in the past, new active ETFs routinely attract more than NT$10 billion in subscriptions.
The surge has reshaped online retail-investor behavior. Social media forums that once focused heavily on individual stocks are dominated by discussions of ETFs — particularly actively managed products — as investors track portfolio changes and attempt to mirror fund managers’ winning trades.
Performance has fueled enthusiasm. Among active ETFs, the top performer since inception is the UPAMC Taiwan Growth Active ETF (00981A), which has delivered a return of 187.9 percent.
It is followed by the Nomura Taiwan Select Active ETF (00980A) with a gain of 127.22 percent, and then the Capital Taiwan Strong Growth Active ETF (00982A), which has returned 124.31 percent. All three have more than doubled investors’ capital since launch.
In just one year, Taiwan has launched 28 active ETFs spanning domestic and overseas strategies, with combined assets under management surpassing NT$500 billion, SITCA data showed.
Industry executives say the boom reflects a broader global shift. Worldwide issuance of active ETFs accelerated sharply last year, with new launches rising about 70 percent from 2024 levels and outpacing passive ETFs and traditional mutual funds.
Nomura Asset Management Taiwan Ltd (野村投信) said that active ETFs account for about 5 percent of Taiwan’s overall ETF market, with nearly 80 percent of assets concentrated in domestic equity products.
Compared with more mature overseas markets, Taiwan’s active ETF segment remains in its early stages and still has ample room to expand — particularly as issuers broaden offerings into overseas equities and fixed income products, Nomura said.
Looking ahead, analysts said the key question is whether the momentum can be sustained once market volatility returns. While strong performance has reinforced investor confidence, some warn that expectations anchored to triple-digit returns might be difficult to maintain, as competition among fund houses intensifies and stock market conditions normalize.
Even so, the rapid adoption of active ETFs suggests they are likely to remain a core feature of Taiwan’s retail investment landscape rather than a passing fad, analysts said.
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